The Board of Control for Cricket in India (BCCI) is the richest cricketing body in the world, and with each passing season, its cash cow – the IPL has become the world’s top sporting league.
With that, there has also been an exponential increase in income creation, leading to calls for the league to be kept under the ambit of income tax. Those voices gained more traction this week after a recent analysis by an IISc (Indian Institute of Science) professor revealed that the world’s wealthiest cricket governing body has accrued approximately Rs 15,000 crore in profits over the past three years.”Consider the numbers. In IPL 2023, BCCI earned a record Rs 5,120 crore surplus, with total income reaching Rs 11,770 crore, driven largely by media rights. Projections for IPL 2024 and 2025 estimate annual revenues at 12,000-13,500 crore. And that’s just one part of the larger earnings ecosystem. Yet, BCCI enjoys income tax exemptions under charitable status,” wrote Mayank Shrivastava, the IISc Bengaluru professor, on LinkedIn.”If a simple 40% tax applied just on BCCI’s IPL profits, nearly Rs 15,000 crores could have been raised over three years – enough to fund 10 new IIT’s or a national deep-tech innovation corpus. Add franchise profits (Rs 800 to Rs 1,200 crore/year), and another Rs 320 to Rs 480 crores could be collected annually. In total, nearly Rs 6,000 crores per year could be redirected into research, just from the IPL ecosystem,” he explained.However, he also reminded that it was not just the IPL which enjoyed tax breaks and state subsidies. “It’s not just IPL. Bollywood productions enjoy tax breaks and state subsidies. Religious trusts command vast commercial empires while enjoying full tax exemptions. New sports leagues are given startup tax holidays. If even a fraction of these sectors were taxed modestly, thousands of crores could fund India’s scientific foundations.””Meanwhile, research institutions in India must pay GST on lab equipment, consumables, and software licenses. Entertainment is subsidised. Research is taxed,” he pointed out.Why is the BCCI not taxed?The BCCI is not required to pay income tax since it is registered as a charitable organisation under Indian law. Its objective is to promote and develop the sport of cricket. But the exemption from tax has come under increased scrutiny, particularly after memos were introduced to permit commercial activities related to the IPL. Additionally, the Bombay High Court recently quashed a tax advisory from the Income Tax Department in mid-February of this year. The Income Tax Department argued that the BCCI’s fundamental objectives had changed due to its shift toward commercial activities.